Rwanda steps up efforts to boost local sugar production, cut imports

The government is exploring ways to increase domestic sugar production to cut heavy reliance on imports, according to the Ministry of Trade and Industry. Data from the ministry shows that Rwanda imported 308,000 tonnes of cane/beet sugar and chemically pure sucrose valued at $238 million (over Rwf340 billion) in 2024 (representing an increase of 24 per cent, up from $192 million in 2023). Currently, domestic sugar production accounts for approximately 7.5 per cent of Rwanda’s total demand, with the remaining 92.5 per cent being met through imports, the Minister of Trade and Industry, Prudence Sebahizi, told The New Times. “This heavy reliance on external supply highlights the strategic imperative to boost local production and reduce the economic impact associated with high import volumes,” he said. Indeed, due to high dependence on imported sugar, Rwanda has been staying the application of the East African Community (EAC) External Tariff on sugar, among other “strategic” foodstuffs, to apply a lower rate and reduce the cost of such items for consumers, according to the Ministry of Finance and Economic Planning. In the current fiscal year, sugar imports are charged a 25 per cent duty, which is a quarter of a 100 per cent rate or $460 per tonne (whichever is higher) under the EAC tariff. ALSO READ: 2023/24: Why 35 Rwandan firms can import sugar duty-free In line with addressing the gap, the government is planning to allocate 8,000 hectares of land for sugarcane cultivation and attract at least $50 million (over Rwf73 billion) in private investment to strengthen processing capacity and boost local sugar production, the Ministry of Trade and Industry indicated earlier this year. ALSO READ: Rwanda eyes $50m investment in sugar production Sebahizi said that the government of Rwanda is currently engaged in negotiations with interested investors who have demonstrated a longstanding commitment to investing in the country's sugar sector. The ongoing land identifition targets the Eastern Province and is currently undergoing assessment to determine its suitability for sugarcane cultivation. “It has not yet been secured pending confirmation of its viability,” he said. Following the assessment of the land’s suitability for sugarcane cultivation, he said, various investors have indicated readiness to facilitate expropriation processes where necessary, in alignment with regulatory requirements and stakeholder engagement protocols. This will be affirmed upon conclusion of the ongoing negotiations, he pointed out. He observed that the feasibility study will inform the production capacity of the sugar plant required and as well as the overall investment projections associated with the initiative. Rwanda currently faces a significant deficit in domestic sugar production, he said. This results in importing more to bridge the supply gap. “This imbalance underscores the urgent need for strategic investments in the sector to enhance national self-sufficiency and reduce foreign exchange losses,” he observed. Joel Uwizeye, Director of Corporate Affairs at Madhvani Group Rwanda, which owns Kabuye Sugar Works, told The New Times that the company is working with the government to expand the factory’s capacity. Kabuye Sugar Works which is located in Gasabo District is the only sugar-producing plant in Rwanda, so far. Uwizeye said that the company plans to establish a new plant capable of producing 60,000 tonnes of sugar annually, along with ethanol that could replace at least 90 per cent of current ethanol imports into the country. “One major challenge is getting the land for growing enough sugarcane and setting up the new factory,” Uwizeye said. He added that the existing factory, which has an annual capacity of 17,000 tonnes, is currently producing just 12,000–13,000 tonnes due to sugarcane shortages caused by floods that damage plantations. The company is working with the government to get flood-free land in districts not far away from Kabuye, such as Bugesera, Kamonyi and Rwamagana, to ensure a consistent sugarcane supply and allow the plant to operate at full capacity. He reiterated that Madhvani Group is ready and committed to continuing to invest in Rwanda.

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Rwanda steps up efforts to boost local sugar production, cut imports